Gilead Set to Make Out Big AGAIN---This Time with $1000 a Day Pill for Hepatitis C

SUPER LONG Thread Warning: Enter at your own risk. If you have Fidgets Disease, be sure to take your medication first.

Before you start reading this, this is not a medical literature review of the pros and cons of any specific treatment for Hepatitis C. This is a study about how Things Are Done in the United States by Private Pharmaceutical Companies and Public Health Departments and Elected and Selected Political Leaders that have the potential to make a very few, very lucky people even richer than they already are. This is a medical economic case study of the Medical Industrial Complex. I am not alleging any illegal activities or ungodly conspiracies. Everything I am about to describe is 100% business as usual in the land of Greatest Health Care System in the World. Anyone looking for a conspiracy theory, move along. You don't have to break the law in order to make it rich in a land where Citizens United is the law.

Those who follow Big Pharm know that Former Bush Defense Secretary Donald Rumsfeld is a very savvy businessman. No, I am not talking about the petrochemical industry or the Military Industrial Complex. The Iraq War did not turn a profit for either Chevron or Halliburton, not when you consider the cost in dollars and lives to the people of the United States and Iraq. Corporate Welfare would have been much cheaper and more compassionate.

Rummie knows how to make a buck from the Medical Industrial Complex. He owned a lot of stock in Gilead which owns Tamiflu, which the US government stockpiled in 2005 under orders from W. during the scare over the possibility of a pandemic and which has become a mainstay of medical treatment for the various swine flu epidemics that have ravaged this country since 2009. Rummie's Gilead stock made him a very rich man.

Well, Gilead is about to strike it even richer. That is because in 2011, it acquired Pharmasset Inc., a company that makes, among other things, a new Hepatitis C medication, Sofosbuvir, which will be available in an easy to take one pill a day for eight weeks form (no more injections, yeah!). Supposedly, the cure rate with this one will be close to 100%. Supposedly, there will be fewer side effects. Definitely, it will require a 2nd and 3rd home mortgage to afford, because it is priced at a whopping $1000 a pill.

I can hear you through the ether-net. The manufacturer has to recoup the research cost. A thousand dollars a day is not too much to prevent my liver cancer. Thank God I just signed up for my new ACA Insurance/got my new Medicaid card. Thank God my doctor just tested me for Hep C. Oh, wait. I haven’t been in for a checkup yet. I’ll be sure to ask for a test. The Republicans might repeal the ACA.

This is not just about the cost of the pill. This is about some other things that have happened since Gilead acquired Sofosbuvir in 2011. Two other things to be precise.

First, in 2012, the CDC proposed that all Baby Boomers (born between 1945 and 1965) be screened for Hepatitis C. If you saw a doctor in 2013 for a routine checkup, you very likely had a Hepatitis C test done. And a few of you were surprised when it came back positive. Hepatitis C was not on your radar of things to worry about. Some of you probably were not even asked if you wanted it done. Your doctor talked to you, told you not to worry, your liver tests were normal. “And, in any case, there is a new, safe, effective treatment coming out.”

If you are lucky enough to live in one of the 26 states that took the Medicaid expansion, meaning that all its citizens have access to health insurance, you just got your Affordable Care Act insurance or your Medicaid this year. A Hepatitis C test is likely to be one of the things your new doctor orders, if you were born between 1945 and 1965. Your doctor is required to order it. Or at least ask you if you want the test done. It is now part of the recommended panel of health screens. And, if the test comes out positive, you will go online and look it up. You will be relieved to see that there are new drugs that the FDA claims are effective and safe. You will be dismayed when you see the price tag---$1000 a pill—but hey, that is what insurance is for, right? Which brings me to my Second point. Gilead’s new drug will be rolled out right as millions of Baby Boomers 1) get insured and 2) find out that they have Hepatitis C.

Now that is good planning. That is how you become a success in Big Pharm today. You identify your target, you create a demand, and you make sure that your target has someone else it can demand pay your exorbitant rate because no individual in his right mind is going to pay $1000 a pill for something that is not even bothering him, but if he can get it for “free” from his insurer or the government then “What the hell? Why not?” And the more asymptomatic, healthy individuals you treat with your drug, the better its profile will be and the lower the rate of bad outcomes will be.

Hint for people in the 24 states that did not take the Medicaid expansion. If you want the drug and you have no insurance, most drug companies have a compassionate use program that allows needy folks to get their drugs for free. Let’s see how compassionate Former Defense Secretary Rumsfeld’s old pharmaceutical company is.

Everyone else, be prepared for some hardball as insurance companies and those who manage public health care dollars wrestle with Gilead over sums of money that have the potential to bankrupt some healthcare plans. Not kidding. There are an estimated 15 million Americans with Hepatitis C (2/3 don’t know it yet). If we treat them all, that is $15 billion a day for 8 weeks. That is getting mighty close to…$2 trillion. And that is just the US market. Then there is Europe. And Japan, where all those poor women were given Hepatitis C tainted products after routine delivery. (see the Bloomberg link below if you have not followed this one) But wait. Japan has approved the competing drug, Simeprevir to treat Hep C. Yes, you read that right. There is competition. Yes, I know that competition is supposed to keep down prices. Imagine how much these drugs would cost if there was not a similar drug being released at the same time. $10,000 a pill? Thank God, Allah, Buddha and the Goddess for the Free Market system!

What about the third world? Gilead’s negotiating the price down in places like India. If they don’t, they knows India will make their own cheap generic. But in the US, Gilead has patent protection and can charge whatever you the taxpayer and insurance policyholder and your attorney think is reasonable. (Not a lawyer, so if I have the next bit wrong would welcome any free legal advice, hint, hint.) For the ERISA loophole---the one that limits damages against a health insurer that denies a treatment to the cost of the denied treatment in the event that something bad happens to you because of the denial of the treatment---probably does not apply to your new ACA insurance, which you are not getting through your employer. So, if your new ACA insurer says “No.” and you die of liver cancer, your new insurer could lose big in court. And Gilead knows it.*

I expect that the $1000 a pill won’t be the final offer. It is a flashy number that was probably chosen because it would generate a lot of media attention. And a new, one a day oral eight week treatment for Hepatitis C can not get too much free publicity right now, with everyone getting new insurance and everyone getting tested for Hepatitis C. I expect Gilead to show some compassion and bring it down to $400-500 a pill. A mere $1 trillion. From the US.

Not to make light of the costs of developing drugs. Forbes estimates that Big Pharm spends $12 billion per drug approved to get a product on the market. But Gilead did not make Sofosbuvir. It bought the company that made it.

Oh, and since no cost is too high to prevent your liver cancer, how about to prevent liver cancer in the guy who is in jail for breaking and entering? How about the guy who allows himself to be sent to jail for possession so that he can get the Hepatitis C treatment he cannot afford on the outside? You’re good with that, too, right?

In case you thought that this was the only Big Drug that is coming down the pipeline, Silly Rabbit, what's sauce for Gilead is sauce for every other pharmaceutical company. Expect a massive onslaught of new drugs that you and your family absolutely can not live without for conditions, some of which you did not even know existed---until now that some drug company is trying to get its piece of our country's annual $3.8 trillion (and growing!) health care spending. And you believed Glenn Beck when he told you to invest in gold. Sigh. I hope we have enough left to pay for vitamins for pregnant women and vaccines for babies once we are finished treating every child with Fidgets Disease and every man with Insufficient Machismo.

http://www.latimes.com/science/la-sci-hepatitis-c-cure-20140412,0,3083638.story#axzz2ynFqEAcS
http://www.sourcewatch.org/index.php/Donald_H._Rumsfeld
http://en.wikipedia.org/wiki/Gilead_Sciences
http://en.wikipedia.org/wiki/Pharmasset
http://en.wikipedia.org/wiki/PSI-7977
http://www.cdc.gov/nchhstp/newsroom/docs/HCV-TestingFactSheetNoEmbargo508.pdf
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aUsdshS6PMJc
http://www.forbes.com/sites/matthewherper/2012/02/10/the-truly-staggering-cost-of-inventing-new-drugs/
http://www.usatoday.com/story/news/nation/2014/03/25/stateline-prisoners-hepatitis-drugs/6871187/
http://en.wikipedia.org/wiki/Simeprevir

*Special plea to any lawyers out there. I know this is a tough one. Did ACA change the way ERISA affects lawsuits against employer sponsored health insurance? Did it expand ERISA? Close the loophole? You know the one I am talking about. The one that says that your Health Insurer can refuse to pay for your heart medication and if you die of a heart attack your family can only sue to get reimbursed for the cost of the pill, not your life. Because I cannot imagine Congress knowingly changing the Health Insurance industry’s favorite loophole, and if it stays the way it is, then once employers start providing more of the coverage then folks going to court to seek relief during disputes with their health insurance will find their options (including their choice of attorneys) limited, since the health insurer will only be responsible for the cost of the treatment, not the cost of the consequence of the missed treatment, including suffering and death.

Oh, look! <----A pumpkin smiley! Hmm. Did I take my pill for Fidgets Disease today?